15 Tips on Building a Development Team for Startup

08.08.2018

A startup journey is like a space mission. It’s risky, and challenging, and requires every team member to give 100%. While astronauts are trained and evaluated for 2 years before the flight, startup founders don’t have that kind of time. This is why a founder should give 200% in building a startup team that will ensure the success of the project.

In this article, we will provide you with some useful tips on building a tech startup team that will help you start quickly, stay within budget, and lay a good foundation for your future enterprise.

#1. Look For a Good CTO

The Chief Technology Officer (CTO) is a universal person. On the one hand, the CTO understands business goals and processes, and it’s easy for a founder to communicate with such an expert. At the same time, the CTO has deep expertise in programming and is able to hire software developers, manage them, and even act as a programmer when needed. But the most important thing for a CTO is to maintain a balance between the business and tech parts.

#2. Don’t Think It’s Easy to Find a Good CTO

You’re probably thinking, “Great, I need a CTO!” Wait just a minute, we’ll consider the risks this approach has. As was mentioned, a good CTO is a balanced CTO. But in real life, it’s quite challenging to find such a person. In most cases, you’ll meet business- or tech-oriented CTOs. Both of them will cause problems for your startup.

A tech-oriented CTO from the outset begins to complicate the system, build up excessive sustainability and scalability, think too much about architecture and future load. It slows a startup down and eats up your money.

A business-oriented CTO, on the contrary, rushes too much. “Need a new feature? You’ll get it tomorrow,” they often say. At first, you will be happy about how smoothly you run. But later you’ll hit a lot of problems and bugs leading to system fails and malfunctions. You’ll realize that it became too difficult and expensive to support and develop your startup.

However, don’t give up too early, and try to find an experienced, well-balanced chief technology officer. But if time goes on and the right person hasn’t been found, think about another tech team structure for a startup.

Good CTO maintains a balance between the business and tech parts

#3. Give Up Looking for a Good CTO

Don’t worry if you don’t manage to find a really strong CTO. There’s one more good way to build a development team for a startup. Instead of hiring a CTO you can hire a project manager and a team lead. In fact, those two play the same role as one united CTO. But together they are much more likely to find a balance between the business and tech functionalities.

The project manager’s primary mission is to achieve business goals. At the same time, this person should understand the software development process and be able to write technical requirements. The team lead is a techie, who interviews developers, manages the development team and can write complex code by hand.

Nevertheless, this approach also has disadvantages. First, the whole team has to wait until the project manager and team lead agree. Second, it’s more expensive to have two team members than one. On the other hand, it’s much easier to find these professionals and you can be pretty sure that your startup will move in the right direction.

#4. Search Through the Community

A professional community plays a great role in startup team building. Regardless of what team member you’re looking for, personal advocacy could be really helpful. Ask your network to recommend IT professionals to be sure you’ll hire reliable people.

Sometimes it turns out that the recommended people don’t suit your project because they don’t have the expertise you need. If so, visit several IT conferences, meetups and hackathons to broaden your network and get more contacts. Also, you can ask a startup community about software development companies they’re currently working with or have worked with in the past. Word of mouth is a powerful tool for building a tech startup team.

Hackathons are good places to find strong development teams

#5. Browse the Internet

Internet, as a channel of search, also shouldn’t be discounted. Of course, it can’t provide as reliable information as personal advocacy can. But you will easily find the exact competencies you need. For instance, if you don’t have a minimum viable product (MVP) yet, it’s probably reasonable to hold off on hiring full-time team members. Browse the Internet to find software development companies that specialize in building MVPs. Use phrases like:

Software development for startups

Develop an MVP for startup

Hire dedicated developers for startup

Development team for startup, and so on

It’s better to avoid queries that are too general, like “software development company”, “mobile development” and so on, because you’ll find IT giants that are too unwieldy to provide the development speed and adjust to changes the way your startup needs.

Describe an MVP you want to create and send it to different companies. Ask them to sign an NDA if you want to keep things completely secret. Examine the proposals thoroughly to choose the best company.

#6. Choose Carefully

When choosing a subcontractor, keep in mind several potential issues. First, if a company offers a fixed-price, make sure you’ll definitely get either a working MVP for the discussed price, or your money back. Otherwise, the final cost might be two times greater than what was originally agreed on.

Second, companies that provide detailed task descriptions tend to be more thorough during software development process. If a quote contains not only the price, but detailed milestones like “testing”, “system deployment”, “demonstration to the client”, etc., this is a good sign.

Third, ask if there is a possibility to hire the same team when you find an investor and are ready to develop the next version of the product. Of course, no one can guarantee that certain developers will be free right when you need them. But some kind of agreement might be made.

#7. Pay Attention to Previous Experience

Coming back to hiring core team members, let’s talk about some things that should be considered. First, it’s vital to hire a project manager who has relevant experience. And we don’t mean technologies, but the size of the company and specific market your candidate has worked in.

Company size significantly influences employee behavior and their way of thinking. A project manager who used to work for enterprises will likely try to optimize processes to do them “the right way” (as they are usually optimized in big corporations) from the very beginning. Needless to say, a startup needs much more flexible management.

The specific market also means a lot, since business processes differ significantly. There are IT companies serving government structures, outsourced development companies, product development companies, and consulting companies. If you are developing a product, hire a project manager from an outsourced development company or product development company to ensure quick adaptation.

#8. Look In Their Eyes

Building a startup is always an adventure. Ask yourself, is this person a self-starter, and how far can he or she get on this journey? A startup project manager should believe in your idea, learn fast, and be flexible. Tell a candidate about your project and pay attention to their reaction. If the person shows genuine interest and offers ideas, it’s highly likely they will be a good choice.

#9. Let the Project Manager Choose a Team Lead

Remember that the project manager and team lead will work together a lot. Conflicts and misunderstanding are the last things you want to see in your startup, right? The tandem is successful when both specialists are compatible with each other. To ensure this, let the project manager–since you hire this person first–make a choice. A tech-savvy project manager can also hire a development team for a startup from an outsourcing company and communicate with its team lead.

#10. Let a Team Lead or CTO Hire The Developers

Skip this tip if you have a solid experience as a programmer. In this case, you will manage to find and choose the best engineers on your own. Otherwise, it’s reasonable to entrust the hiring of software developers to your leading technical specialist–the CTO or team lead. The logic is quite simple: when you don’t have a strong understanding of something, it’s better to rely on professionals. Moreover, IT experts always have a broad network that can be used for hiring.

#11. No, You Can’t Completely Delegate Hiring

In companies with less than 100 employees, a founder usually holds the final round of interviews. Why? In the beginning it’s crucial to hire like-minded people to build a foundation for a strong corporate culture. Keep in mind that a developer you’re hiring now will likely grow to team lead or head of department. When all the core team members each share one vision, staff turnover decreases significantly. It’s much easier for a company to grow when there’s no need to replace people all the time and resolve conflicts.

Hire like-minded people to stay the course

#12. Pay Competitive Salaries

You have probably heard that startup teams usually work for the idea, not for money. This is true, if you hire university graduates who don’t have lots of experience, or expensive bills to pay. Of course, sometimes passion means more than skills, but the risks increase significantly.

To stay the course and reach your goals, you should lean towards experienced professionals. Yes, they want good salaries, and any startup has budget constraints. How do you solve this issue? One way is to offer options or equity to compensate a low base salary. The second way is to hire dedicated software developers from Eastern Europe or Russia, which is 2-2.5 times cheaper than hiring US locals. Thanks to this, you’ll be able to pay your key team members enough.

#13. Lean Towards Full-Stack Developers

Full-stack developers solve a lot of problems. First, concerning a dynamic startup environment: the fewer people you have, the easier the communication flows and the more flexible your project is. Moreover, paying one programmer is cheaper than two. On top of that, today’s technologies, like Node.js, allow the use of one language for both frontend and backend, which makes hiring full-stack developers even more reasonable.

#14. No Rush

When you have an idea you really believe in, it’s tempting to start working as soon as possible. This is the right intention, but try to avoid hasty decisions concerning your startup’s development team. Airbnb spent over five months searching before they selected their first employee. This is a company that you can learn from.

Hasty decisions won’t help to build a great tech startup team

#15. Hire Full-Time Developers When You Get Investments

At a startup’s early stages the demands for the staff are often patchy. For instance, MVP development is usually followed by a period when you test your hypothesis, set up experiments, and search for an investor. This is a time when you don’t need developers, but you have to pay them if they are in-house employees.

The way around this is to hire contract team members in the beginning and replace them with full-time team members when you get investments. However, usually startup owners offer full-time jobs to the developers who initially proved themselves as temporary staff. We often see this in practice, when SoftMediaLab developers join startup teams as full-time members and continue to work on the project remotely.

Summary: How to Build a Development Team for a Startup

“Not the right team” is the reason why 23% of startups fail. Generally, there are two main tech team structures for startup. The first one is hiring an experienced CTO who can balance business and technical goals, hire software developers, and manage their work. The second structure uses a project manager, who is responsible for the business part, and a team lead, who solves all the technical issues.

Referring to the second structure, it’s reasonable to let the project manager choose a team lead. And it should be the team lead who will choose the developers. But it’s always the founder who has the final say in the hiring process, because a startup is much more successful when driven by like-minded people.

If you don’t have an MVP yet, find an outsourced development company to develop it on a turn-key basis. If you have already received an investment and have a lot of work to do, consider hiring dedicated developers to keep the costs down and offer higher salaries to your core team members. Regardless, contact us now and get one step closer to your amazing startup team.